Meet PetFlow, The Retailer that Hatched a Media Business

Brands and retailers are increasingly trying to become publishers of sorts. They use blogs, social media and other forms of content to attract and entertain online audiences, with the ultimate goal of selling them something.

But what happens when your publishing operation proves so successful that it morphs from a marketing strategy into a media business in its own right? Online retailer PetFlow is figuring that out.

PetFlow first created a Facebook page in 2011 and a blog in 2012, hoping to attract the attention of users that might purchase pet toys and treats. The company began posting “shareable” animal-related pictures and content, which it found resonated well with users and drove significant interest in its e-commerce site.

Soon, PetFlow began to understand that its audience enjoyed more than just animal-related content, and the firm began to broaden its approach. “We knew pet-related content did great, but learned human-interest stories also do really well,” said Alex Zhardanovsky, the company’s chief executive.

Fast-forward two years, and PetFlow’s properties had amassed an online audience that would be the envy of many dedicated media companies. By June 2014, its Facebook page had attracted over 800,000 “likes”, and its blog was seen by more than 20 million unique users a month, according to comScore.

What’s more, the company wasn’t just extracting revenue from its audience by selling dog food; it had begun selling banner advertising and content recommendation ads to third-party companies, too. The PetFlow blog became a viable media property in its own right.

Recognizing this, the company decided to separate its publishing operation entirely from the PetFlow site in September, and migrated to a new Website and Facebook presence called LittleThings.com. Now, PetFlow is out pitching advertising and sponsorship opportunities to marketers that might be interested in reaching its audience, which Mr. Zhardanovsky said skews heavily female with an average age of 45.

“PetFlow is still an e-commerce retailer, but in addition to that we now have a content business,” Mr. Zhardanovsky said. “Now we’re working on big deals with pet food manufacturers where they can advertise on LittleThings.com to a pet-related audience,” he added.

Prior to PetFlow Mr. Zhardanovsky founded online ad network Epic Advertising, so he’s no stranger to the online ad world. In many ways, the media side of PetFlow’s business is actually easier to manage than the retail side, which generates around $50 million a year in sales.

“In e-commerce there’s shipping and warehouses; it’s a big and heavy operation. The media side is smaller, but it’s profitable. The e-commerce side is almost break even,” he said.

Profit from PetFlow’s media property is primarily used to acquire new customers for its e-commerce business, Mr. Zhardanovsky added. Selling ads to third parties is a more effective use of its audience than simply promoting its own retail outlet.

“I could put our own banners on the site, but if I can make $10,000 in ad revenue and use that to acquire customers somewhere else for less, I’d rather do that,” he said.

Currently around 60% of LittleThings.com traffic comes from Facebook, but the company is also figuring out how to buy traffic from services such as Taboola to boost its audience. The site attracted 30 million unique users in October, according to PetFlow’s internal numbers. The company is hiring new editorial staffers to test and publish more content on the site, and is also considering launching additional sites based on what it’s learned about the nature of sharable content and online audiences.

“I don’t know if this works for everybody, but it’s working for us,” Mr. Zhardanovsky said.